Question 9 (5 points) A firm is evaluating a $50,000 sales opportunity (S) for a new customer. The Variable Cost Ratio (VCR) is 70% of sales. Collection Costs (EXP) are 3% of sales per CP beginning with second CP. After 90 days the invoice will be turned over to a collection agency that collects, on average, 50% of the invoice amount earning a 50% commission based on amount collected. The firm's cost of capital is 11% (1. What are the COLLECTION COSTS (EXP) for the 76-90 Days CP bucket i the new customer account performs similarly to existing customers? NPP 1+ICP S-EXP(S) - VCR(S) NPV Expected NPV DSO Payment Probability Collection Costs Collection Cash (EXP) Flow Collection Period (CP) 59,745.07 45 $14,330.99 68% $0 $50,000 90 Days Expected NPV of Credit Extension 100% $1,500 $3,000 $4,500 None of the above